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India – Vodafone, Bharti Airel Among Participants in Upcoming Auction.

21 January, 2014

 

Legal News & Analysis – Asia Pacific – India – TMT 

 

Eight Indian mobile phone carriers that include market leaders Vodafone and Bharti Airtel have applied to participate in an upcoming auction of wireless licenses to be conducted by India’s government on February 3. The sale of regional and nationwide licenses encompassing 45 MHz of spectrum in the 900 MHz band and 403 MHz of spectrum in the 1800 MHz band constitutes the government’s third attempt to sell the channels in question. Complaining that prescribed reserve prices were excessively high, all of India’s existing GSM wireless operators opted against bidding in the last auction event that had been scheduled for March 2013.

 

For the pan-India license in the 1800 MHz band, cabinet officials have approved a base price for the upcoming auction of US$28.78 per MHz, which is reported to be 26% lower than the reserve established for last year’s sale. Base prices for regional 900 MHz licenses covering markets such as Delhi, Mumbai and Kolkata are said to be up to 53% lower than last year’s reserve. In addition to Vodafone and Airtel, other participants include Idea Cellular, the nation’s third-ranked wireless carrier, Tata Teleservices, the Indian unit of Norway-based Telenor, and fast-growing upstart Reliance Industries. Although the channels to be auctioned are designated for second-generation voice services, the government has removed usage restrictions to permit carriers to deploy these same channels for third- and fourth-generation wireless broadband offerings.

 

Predicting that the auction will exceed the government’s revenue target of US$1.8b, an official with India’s telecommunications ministry told reporters: “we are very positive.”

 

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